State-owned Indian Bank has reduced interest rates on home and car loans by up to 0.5 per cent to increase disbursements in these segments.
The Chennai-based bank tweaked interest rates of retail loans soon after Finance Minister P Chidambaram advised banks to keep EMIs at affordable level.
"We have recently reduced interest rate on home and vehicle loans with an aim to increase credit disbursement in these segments" Indian Bank Chairman and Managing Director T M Bhasin said here today.
In the housing loan segment, rates has been reduced by up to 0.5 per cent, while interest rate on car loan has been slashed by 0.25 per cent effective August 25.
Housing loan up to Rs 30 lakh is now available at 10.5 per cent or base rate irrespective of the tenure of the loan.
Similarly, rate has been reduced for home loans between Rs 30-75 lakh to 10.75 per cent or base rate plus 0.25 per cent.
The bank has also waived of processing or administrative charges on such loans.
Besides, it has brought down the car loan from 11.25 per cent to 11 per cent.
The offer, limited till October 31, would be made only to the new vehicle loan borrowers. There will be no processing charge on loan application.
Asked whether the bank would consider reducing the base rate, Bhasin said, "It would depend on the monetary policy indications".
At present, the base rate or the minimum lending rate of the bank stands at 10.5 per cent.
Yesterday, another public sector Punjab National Bank (PNB) slashed interest rates on home loan and car loans by up to 0.5 per cent.
In the housing loan segment, rate has been reduced by 0.25 per cent while interest rate on car loans has been slashed by 0.5 per cent by PNB.
Last week, Corporation Bank slash interest rates on home, car and educational loans for a limited period of three-month. The bank also decided to waive the processing fee for these loans.
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